The Spot Price of a Futures Contract Is Different Than

question 13

Multiple Choice

The spot price of a futures contract is different than the price for which an investor can buy the underlying commodity for immediate delivery. This represents an opportunity for ________.

• A) arbitrage
• B) hedging
• C) speculation
• D) loss leading

---

Definitions:

Net Working Capital

The gap between a firm's current assets and its current liabilities, showcasing its operational effectiveness and short-term financial stability.

Current Liabilities

Obligations that a company needs to pay within a year.

Net Working Capital

The gap between a firm's present assets and its current obligations, signalling its short-term economic condition.

Operating Activities

Business actions directly related to the production, selling, and delivery of a company's goods and services, reflected in its cash flow.